Si Handling Reports Loss In 2nd Quarter

November 06, 1986|by TOM MOYLAN, The Morning Call

Slow investment in factory automation is cited as the reason for a $645,000 second quarter loss for SI Handling Systems Inc. of Forks Township.

The loss, which was projected, contrasted with $28,000 in net earnings for the same quarter in 1985. The results translated into a loss of 44 cents per share, compared to earnings of 2 cents per share last year.

Second quarter sales were down 28 percent to $4.2 million.

For the first six months of the company's 1986 fiscal year, it lost $620,000 on sales of $10.6 million against last year's earnings of $30,000 on sales of $12.1 million.

The company blamed the quarterly loss on low sales resulting from a nationwide slowness in capital investment in factory automation equipment for the first half of the year.

But the company says results will change dramatically with the receipt of some large orders within the next fewweeks. It said it expects to capitalize on its strong market position in the warehousing and distribution field.

Leonard S. Yurkovic, SI's president and chief operating officer, said the new orders won't come in time to avoid a loss when the books close on the 1986 fiscal year in February, but he said there was "no question" that the company will be in the black next year.

"The outlook for next year is very high and positive," Yurkovic said.

In June, L. Jack Bradt, chairman and chief executive officer, said that SI would likely be profitable for the full year.

Last month, John DeRito, SI's vice president of finance, told the Northampton County Board of Revenue Appeals that employment was down to its lowest in five years. Yurkovic said the company presently employs about 200 people.

And as the workforce decreased, the company's white-collar workers, who represent four out of five employees, took a 10 percent across-the-board pay cut this year.

DeRito said the company is operating at 40 percent of capacity and asked the Northampton County Board of Revenue Appeals to reduce its tax assessment to $388,800 from $735,300. The board granted the request.

SI last month received a U.S. patent for an intelligent driverless vehicle. The vehicle, the Cyclopion, is expected to give the company an edge in the material handling market. But Yurkovic said the prototype is still being developed and that the device will probably not be marketed in the near future.

SI also reported the resignation of James McDougall from its board of directors. No replacement has been named.

Yurkovic said the resignation leaves the company with seven directors. He said the company's by-laws authorize 10 directors,but the board has found that eight members work best. SI makes material handling systems for manufacturing and storage.